Ammirati puts positive spin on Labatt loss, Sears drop

Ammirati Puris of Toronto is not daunted by setbacks such as the loss of its cornerstone account Labatt and its surprise resignation of Sears Canada. New president and CEO Neil Everett is forging ahead with plans to rebuild and grow the agency.

Ammirati Puris of Toronto is not daunted by setbacks such as the loss of its cornerstone account Labatt and its surprise resignation of Sears Canada. New president and CEO Neil Everett is forging ahead with plans to rebuild and grow the agency.

Although Sears’ intentions were to stay with Ammirati, focus on the work and move on with the relationship, the agency declined. The Sears broadcast assignment handled by Ammirati is estimated at $25 million.

Nina MacLaverty, Sears’ VP of retail advertising, was surprised and disappointed with the agency’s decision.

‘We have had such a great relationship with Ammirati and a fairly long one, over four years. I’m very respectful of the fact they’ve made this decision. If they don’t feel they can continue the relationship, that’s absolutely their call.’

The fact that Sears had given a project to John St., the Envoy Group agency headed by former Ammirati president and COO Arthur Fleischmann could have been interpreted to mean the relationship was on shaky ground but MacLaverty disagrees. She says Sears has always worked with multiple agencies and that she had informed Ammirati that she had handed John St. an assignment.

‘It was supposed to be a short-term project so that I could diversify my options if I needed to. I didn’t expect to need it.

‘The fact that Arthur (Fleischmann) and Emily (Bain) were working on the Sears business when they were at Ammirati is comforting for me. I had never worked with [creative team] Steve [Jurisic] and Angus [Tucker] so that was one of the reasons we gave them the project – to see if the full circle of planning, account planning and creative was viable for me.’

MacLaverty does not expect to start a full-fledged agency review any time soon since all work into the new year is completed or underway.

Labatt Breweries of Canada, which spends an estimated $60 million a year across its portfolio of brands, ended its eight-year relationship with the agency earlier this month, heralding a real trial by fire for Everett. When Everett and Jeff Finkler replaced agency co-founder and chairman Doug Robinson as president/CEO and chief creative officer respectively in October, they found the Canada Bread account already half way out the door and were handed Labatt’s walking papers in their second week on the job.

Everett, former SVP marketing at Shoppers Drug Mart, says rocky start aside, his mandate is to make an assessment of the agency’s strengths and weaknesses and then make strategic recommendations for growing it – either organically or through acquisitions. Successful rebuilding of the agency, he says, will also mean its parent company, the Interpublic Group of Companies (IPG), would again make the Ammirati Puris brand, now only in Canada, an international entity.

‘The only reason I came to the agency was to grow it. It certainly wasn’t to shut it down. IPG has deep pockets and is prepared to invest behind the [Ammirati] brand.’

While he’s sorry he won’t have the chance to work on the Labatt business, Everett says Labatt’s departure has helped expedite the rebuilding timetable.

‘In a weird sort of way, it’s a good thing to happen to the agency because my assessment and Jeff’s assessment since we’ve been here is the agency kind of lost its focus and its way over the last few years.

‘Our opportunity, now that Labatt has made its decision, is to retrench and rebuild the agency based on the fundamental principles that made it successful in the first place.’

Ammirati Puris reported gross revenues of more than $15 million in 2000.

On the heels of the Labatt announcement, rumors of other client defections swirled around Ammirati for brands such as Fuji.

Fuji Film Canada of Mississauga, Ont. is thrilled with the work it’s getting from Ammirati and has no intentions of moving its business, says Karen Tam, the company’s marketing communications manager.

One of the things that drew Everett and IPG together was his past experiences on the client side and his vision of what an agency should be.

‘The reason I decided to take the Ammirati opportunity was because I had several discussions with IPG about re-looking at the agency model. That’s funny because that’s what Labatt is saying too.

‘I truly believe agencies have become too focused on execution and are not investing enough time on corporate and brand strategy,’ says Everett. ‘As a former client, I felt the most value that came from my agency was not from the 30-second spot because you put it on for eight weeks and it’s gone. It was the thinking that went into the brand positioning up front that was really key, because while a TV commercial becomes disposable, the brand’s core positioning is what really grows the value of the company over time.’

Labatt puts its money behind ideal agency model

Labatt Breweries of Canada expects to begin moving its business from Ammirati Puris to its new-model agency by the end of this month.

The new agency is a startup that Labatt is backing in a move reminiscent of its relationship with the fledgling Ammirati early in 1994.

Charles Oliver, vice-president of marketing for Labatt, says he has contacted a number of senior creative and strategic planning people to discuss their involvement in the agency. He says the agency will not be in-house and will not be owned by Labatt, but rather the brewer will give its business to the shop and develop a generous compensation model that will also include a bonus component.

Oliver is also expecting to bring other ‘likeminded’ advertisers on board. The agency will be limited to no more than four clients and those clients will sit on the agency’s advisory board.

‘The reason we parted company with Ammirati wasn’t a dissatisfaction with the creative output or efforts of the individuals, it really was about value and efficiency,’ says Oliver.

‘We believe in the agency business but, over time, a lot of extra costs have been added on that model in terms of layers of people, and the profit pressure that comes with any major agency having to be part of a large financial infrastructure.

‘We want to pay really good money for great advertising and have that money end up in the hands of a few senior individuals that we compensate for coming up with great creative ideas.’

Oliver adds, ‘We’re not interested in paying for administration or, in the traditional sense, client management. The focus really is on great creative ideas.’

Doug Robinson, former Ammirati chairman, is currently contracted to work on a project for Labatt, but is not in discussions to become part of the Labatt agency. Robinson still has some legal issues to complete with Ammirati before he can move on to any new position.